Eric Schmidt whips out mystery Android

'Ah, but I said no...Nexus Two'

Google CEO Eric Schmidt has demonstrated a mystery Android phone that uses a near field communication (NFC) chip that could effectively turn the handset into a credit card, offering the ability to "tap and pay."

But then he pulled out the handset, which he called an unannounced product that used Google software. The device appeared to use service from fourth-place US wireless provider T-Mobile.

Schmidt demonstrated the "tap-and-pay" bit, "checking in" to The Palace Hotel in San Francisco, which is hosting this week's conference — i.e., touching a pad that tells the phone it's at the hotel. And he said that technology will be offered with the next version of Android, code-named Gingerbread, which is due "over the next few weeks," according to Schmidt.

Asked if Google would consider bringing back a Nexus One–like phone and an online webstore similar to where the Nexus One was originally sold, Schmidt said: "I only said that we would never offer a Nexus Two," an obvious reference to the Nexus S rumor. ®